BoG to review new forex rules April end

The Bank of Ghana (BoG) has reveled it will only review new and revised forex rules it implemented this year after three months in operation.

The Bank of Ghana introduced the rules in February as part of moves to save the cedi from further fall.

Among the rules commercial banks were banned from issuing cheques and cheque books on Foreign Exchange Accounts (FEA) and Foreign Currency Accounts (FCA).

Banks are also prohibited from granting a foreign currency-denominated loan or foreign currency-linked facility to a customer who is not a foreign exchange earner.

The central bank also banned offshore foreign deals by resident companies, including exporters in the country.

Also over-the-counter cash withdrawals from foreign exchange and foreign currency accounts not exceeding US$10,000 shall only be permitted for travel purposes outside Ghana or its equivalent in convertible currency per person per travel.

The quotation and transaction of goods and services in foreign currency was also banned by the central bank.

However there were calls for the central bank to review the rules by stakeholders in a number of sectors including the real estate industry, hospitality as well as importers and traders.

Last week the International Monetary Fund (IMF) also called on the Bank of Ghana to review the rules.

Its country representative Samir Jahjah says the fund hasrecommended to the Bank of Ghana to ‘review the measures in light of the reaction of the business community and investors’.

Samir Jahjah told Citi Business News the central bank would have to listen to concerns raised and look at reviewing it.

‘Are these measures hurting the economy or not? Are they affecting capital flows? We (IMF) don’t have that response. That is why it is important that after a while they look at the impact of these measures on the various parts of the economy the financial sector but also the real sector, and based on this review, reassess these measures if needed”, Samir Jahjah added.

But speaking to journalists after the Monetary Policy Committee meeting today Governor of the Bank of Ghana Dr Henry Kofi Wampah said it was too early to review the rules.

“We will definitely review. We think it is just too early. Perhaps maybe after three months, we will do a review of it and see whether there are some unintended adverse effects and based on that we will take a decision.”

“I agree that people are complaining about the measures, there are also people saying the measures are working. Definitely we will revise the rules”, he added.